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2025 Supreme(Mad) 2393

IN THE HIGH COURT OF JUDICATURE AT MADRAS
J. Sathya Narayana Prasad, J.
Sivas Papers Private Limited – Petitioner
Versus
The Director of Panchayat and ors. - Respondents
W.P.No.11324 of 2025 and WM P.No.12762 of 2025
Decided On : 09-04-2025

Advocates:
Advocate Appeared:
For the Petitioner: Mr.C.Prakasam
For the Respondent:M/s.M.Rajendran, AGP, Mr.K.H.Ravikumar, Govt. Advocate

Demands for welfare fund contributions must be legally justified and clearly communicated, requiring strict adherence to relevant laws and transparency in administrative processes.

Headnote:(A) Constitutional Law - No specific statutes cited regarding construction workers' welfare fund and building approval process - The court held that demands for welfare fund should be based on established legal provisions and transparency in communication. (Para 1, 2, 6)

Facts of the case:
The petitioner sought to construct a godown and after obtaining necessary approvals, the 5th respondent demanded an exorbitant amount for the construction workers' welfare fund without providing a justified basis for the demand. The petitioner argued that the amount was unreasonably high compared to the actual calculation of the building cost. (Para 2, 3)

Findings of Court:
The court ordered that the 3rd respondent must consider the proposal pertaining to the welfare fund and take action while ensuring adherence to legal standards within four weeks. (Para 6)

Issues: The main issues addressed include the legality of the demand for the construction workers' welfare fund and the process for obtaining building approval without due justification. (Para 2, 3)

Ratio Decidendi: The court emphasized the necessity for clear communication and proper justification behind financial demands made regarding welfare funds, ensuring compliance with relevant laws and transparency. (Para 6)

Result: Writ petition disposed of with directions to pass orders within four weeks.

Table of Content
1. details of the petitioner's construction project and welfare fund demand. (Para 1 , 2)
2. government advocate's statement on the welfare fund proposal. (Para 3 , 4)
3. court's directive to ensure timely response on welfare fund proposal. (Para 5)
4. conclusion and order regarding the petition. (Para 6 , 7)

ORDER :

J. Sathya Narayana Prasad, J

This writ petition has been filed to forbear the 5th respondent from demanding Rs.22/- per sq.ft for construction workers welfare fund for granting building plan approval to the petitioner's construction situated in Re.SF.No.41/3B2, 42/1 and 42/2, Veerachozhapuram Village, Veerachozhapuram, Kangayam Taluk, Tiruppur District.

2. The petitioner is the Managing Director for the purpose to keep the paper materials and decided to construct godown, in this connection he purchased land situated in Re.S.F.No.41/3B2, 42/1 and 42/2 in Veerachozhapuram village to an extent of 10 acres, and they approached the Director of Town and Country planning along with godown building plan for getting approval after paying prescribed fee they obtained approval. The petitioner made online building plan application before the Assistant Director of Tiruppur District Town and Country Planning and obtained Technical Clearance in turn the Assistant Director sent communication to the 5th respondent for issuance of final building plan approval. The petitioner proposed to construct 61,119sq.ft with cement sheet roof godown, and approached the 5th respondent and produced the Assistant Director of Town and Country Planning approval and paid prescribed fee. But the 5th respondent demanded Rs.22/- per sq.ft for construction workers welfare fund for a sum of Rs.13,44,618/- that too without disclosing the amount arrived under in which GO. The Village panchayat collecting the welfare fund at the rate of 1% total cost of the building. It is only four wall and iron truss angles with cement sheet and there is no seperate wall and other additional interior expenses the total cost comes to Rs.4,27,83,300/- at Rs.700/- sq.ft, the fund amount is calculated at Rs.4,27,833/-, whereas the 5th respondent demanding a sum of Rs.13.44.618/-. In this regard, the 5th respondent issued a demand notice and the same was received by the petitioner through online. The representation of the petitioner was considered and the 4th respondent sent communication to the 3rd respondent dated 07.03.2025, but the 3rd respondent not issued any reply, whereas the 5th respondent demanding Rs.22/-sq.ft for the welfare fund without giving any written order, but online reply was issued without any signature, hence, the petitioner could not challenge the same.

3. The learned Government Advocate appearing for the respondents 4 and 5 on written instructions from the 3rd respondent vide Na.Ka.No.A2/507/2025 dated 04.04.2025 has stated that the proposal with regard to construction workers welfare fund at Rs.22/- per sq.ft. for building approval has been sent to the Assistant Director of Panchayat/3rd respondent on 07.03.2025 and the orders are yet to be passed on the said proposal. The relevant portion of the said proposal is extracted hereunder :-

4. The learned Government Advocate would further submit that this Court may stipulate a time frame enabling the 3rd respondent to pass orders on merits and in accordance with law.

5. Heard the learned counsel for the petitioner and the learned counsel for the respondents and perused the materials available on record.

6. The 3rd respondent is directed to pass an orders on the proposal forwarded by the 4th respondent on 07.03.2025 with regard to the construction workers welfare fund, within a period of four weeks from the date of receipt of a copy of this order.

7. With the above observations and directions, this writ petition is disposed of. No costs. Consequently, connected miscellaneous petition is closed.

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